Thammasat University Professor
Pavida Pananond, PhD, is Professor of International Business at Thammasat Business School, Thammasat University.
The Charoen Pokphand (CP) Group is on the move again to swell further in size, weight and power over the market. Having recently acquired Tesco's operations when the British retailer sold out and exited Thailand and Malaysia, CP is now aiming to consolidate its grip on the telecommunications industry in a planned merger between its True Corporation and Total Access Communications (DTAC), the local subsidiary of Norway's Telenor. If successful, the merger would reduce Thailand's major telecom players from three to two and further concentrate market dominance over the telecom market to the detriment of consumer choice and welfare.
The changing nature of globalisation, compounded by pandemic-induced disruptions require a rethink of Thailand's place and direction in the global economy. Already hampered by pre-Covid trends of global slowdown in trade and investment, the economy is facing tougher challenges as the pandemic has forced multinational companies to reconsider their supply chain configuration. The changing contours of the global economy on the one hand and ongoing political tensions at home that have delayed much-needed structural reforms on the other are becoming a perfect storm that could blow away Thailand's chances of maintaining its once central role in Southeast Asia's economic dynamism.
Picking up the pieces and preparing for the future after the economic and social ravages wrought by the coronavirus (Covid-19) pandemic cannot start soon enough. For Thailand and Southeast Asia more broadly, pre-pandemic imperatives of economic upgrading for higher value-added jobs and industries are now compounded by new Covid-induced dilemmas of rising unemployment and labour abundance. Addressing this double whammy of economic challenges requires policy responses that are nuanced, fair and forward-looking in trying to achieve multiple objectives after the virus subsides.
Thailand's economy appears both odd and contradictory. On one hand, it continues to expand in the 3% range, an appealing growth trend by international standards. On the other hand, cursory and anecdotal evidence suggests the Thai economy is mired in a prolonged malaise.